Services return trust in the economy / But most sectors still pessimistic

The economic sentiment index improved in the first quarter of this year. Based on the Bank of Albania’s business and consumer confidence survey, the economic sentiment indicator increased by 8.5 points compared to the previous quarter.

In fact, the improvement in the first quarter of this year came almost entirely from the service sector, while other sectors of the economy and consumers again showed pessimistic sentiment.

The confidence indicator in the services sector increased by 16.1 percentage points during the first quarter, rising above its historical average. The improvement reflected an increase in the business performance balance, by 18.7 percentage points, and the demand balance, by 13.5 percentage points.

The confidence indicator in the trade sector recorded a very slight increase of 0.3 percentage points. The deterioration of business performance by 5.1 percentage points was offset by expectations for employment performance in the next quarter, by 5.7 percentage points.

The confidence indicator in the industrial sector continued to decline during the first quarter and resulted in about 3.1 percentage points below the level recorded in the previous quarter. The decline came especially from the deterioration of production, by 11 percentage points, and to a lesser extent from the decrease in custom contracts, by 2.7 percentage points.

The confidence indicator in the construction sector was 0.5 percentage points below the level recorded in the previous quarter. The decline is mainly due to the decline in the balance of contracting orders, by 4.8 percentage points, while construction activity improved by 3.7 percentage points.

The consumer confidence index continued the downward trend during the first quarter, with 1.5 percentage points below the level of the previous quarter and 2.9 percentage points below the historical average. The perception indicator on the overall economic situation expected in the country fell by 3.7 percentage points and the income and expenditure balance fell by 2 percentage points.